Implementing matrix management – wave 2: Deciding on Structure

The second wave of change in implementing a matrix organization and matrix management is in deciding on and announcing the structure itself.

The development of a detailed matrix structure is extremely time-consuming. Senior managers spend a great deal of time on defining structure, reporting relationships and roles, and on the individuals who will fill them.

Some individuals will see themselves as winners and others as losers in any structure, and it takes time and effort to manage this. Whilst organization design may seem a logical process, the reality is that power, career and legacy relationships will be taken into account, and the structure may be moulded around powerful individuals as well as strict strategic needs.

We recommend that this is the stage when managers should already be thinking beyond structure and start looking at the networks, communities, teams and groups they need to get things done in the new organization. These are the entities that really deliver results in matrix management and matrix working and are far more important than the formal structure – we should be giving them at least as much attention at this stage.

By the time the process of agreeing structure and roles is complete, senior managers have already invested a great deal of time and attention on structure.

In many organizations, this is when major changes are announced. Senior leaders move to new roles or leave the organization. Whole departments and divisions are established, moved, merged or disbanded. Cost savings associated with the new strategy are delivered through layoffs and outsourcing, etc. This can take a lot of time and emotional energy as difficult decisions have to be made with wide ranging effects on people.

At Cisco, 20% of the management group left, and at P&G, it was 50%. These departures were positive changes, representing a victory of collaborators over the command and controllers.

Jay Galbraith, author of Designing Matrix Organizations That Really Work

Many parts of the structure discussion are confidential, and may not be announced until critical individual moves have been agreed.

The costs of this phase will normally be those of internal management time and attention. High levels of turnover at senior levels can be extremely disruptive to an organization, even if they were necessary in the long-term.

So, finally, leaders are ready to operate the new matrix organization structure. There has already been an enormous amount of management work, but this marks the moment when there is a large increase in the number of people who need to be involved in the implementation of the matrix if we are to succeed.

When the structure is publicly announced, this may be the first time that most individuals in the organization have given the matrix any serious thought. They will also need time to discuss, understand and assimilate the strategy and structure.

At this stage it becomes clear, if it wasn’t already, that systems and processes need to be aligned to support this new way of working.